Google eBay Spat Over

    June 14, 2007

The spat between eBay and Google is now officially over, and is a great lesson on who can get away with what. The spat centers around Google check out that competes with Pay Pal that eBay uses, and has forbidden eBay users to use. Then there is the big eBay party in Boston, in that Google was going to throw an alternative party "let freedom ring" (tea anyone?) to show off their check out system to all the folks gathering for the big eBay bash.

Not one to be pushed around, eBay dropped all their ads in Google, and Google blinked, killing off the party and the ability to meet and greet with the eBay literati.

Two titans, both with a product, and we think this is the first time that Google has blinked, and it bodes well. This is the first time that Google has "lost", and not lost on their own terms. Google is now no longer "invincible", and people are learning that it can be defeated. Ok, so it might take being as big as eBay, but hands down, eBay won this round.

"We are pleased that they apparently have seen that the party was inappropriate," Mr. Durzy said. "It is not the way one partner should act with another." Besides being rivals, the companies have a deal for Google to sell ads on eBay sites overseas.

Analysts said eBay’s decision to withdraw its ads is not likely to hurt the search giant. EBay spends less than $25 million on Google a quarter, said Jordan Rohan, an analyst with RBC Capital Markets, or only a tiny fraction of Google’s nearly $3.7 billion in revenue in the latest quarter. Source: NYTimes

There is a lot to this, but then there is not a lot to this. The average person is not going to make Google blink, but they have shown a vulnerability, in that the way to reach them is through the pocket book. If you have a major account with Google, you might be able to get things done that you were not able to get things done before. It will be interesting to see how this plays out in the longer run with the advertisers who use Google, and what the approach of the bigger companies will be after this.